January 12, 2006

City Awaiting Signature On New Lease Agreement

After expending more than $20,000 on a new roof for one of its lone remaining economic development sites, the City of Memphis is still awaiting the signature of the building’s current tenant on a new lease agreement.

Ernie Miller of Miller Manufacturing, a fiberglass fabricator, was not present at the city council’s January 5th meeting. Miller’s absence led to the council requesting that city attorney David Peppard draft a notice to Miller indicating the lease needed to be signed in the immediate future. While a definite deadline was not established, the council indicated its desire to have the situation resolved as quickly as possible.

“If he [Miller] has a problem with something in the lease, I’d be happy to discuss it with him,” Peppard told the council.

The new agreement establishes a one-year lease of the building, which is located on East Monroe Street across from Hopkins Lumber. The new contract would keep the existing rental rate of $350 per month. It was approved by a 4-0 vote at the December council meeting.

Miller originally relocated his operation to Memphis from Oklahoma several years ago and has been operating at the site under the original one-year lease that has long been expired. Miller has maintained the monthly rental payments of $350 for the entire period.

Alderman Lucas Remley indicated he would like to see the city raise the rent considering it is embarking on the significant investment for the new roof.

“How can you justify raising the rent when the building is in the kind of shape that it is in?” asked Dr. Harlo Donelson, head of the city’s economic development board. “That is not fair to him.”

Alderman William Reckenberg stated that the poor condition of the building’s roof and interior obviously was not conducive to running a business.

However Alderman Remley noted that Miller had been renting the facility for more than three years and he had never attended a council meeting to discuss the conditions.

“I sure wouldn’t say that I could have been a millionaire, but my roof leaked,” Remley said. “If that’s what was preventing the business from getting up and running, it should have been addressed a long time ago.”

Donelson also noted he would like to see the city extend the length of the lease agreement from the current one-year offer.

Remley countered, stating his concern that the site is supposed to be used for economic development in the community and pointing out that he did not believe that Miller Manufacturing currently had any employees.

“I think we need to lease the building one year at a time,” Remley stated. “What if tomorrow we have a business that comes to town needing a facility to set up its operation and create local jobs? If we sign a long-term lease we may be stuck with a storage facility with a new $20,000 roof on it.”

Alderman Ron Gardner seemed to agree with Remley’s point noting that he felt the city should focus on economic development more than simply being a landlord collecting rent on the building.

“I think it is all of our goals to get that building up and running and full of employees,” stated Alderman Teresa Skinner.

Alderman Reckenberg agreed that a one-year lease was in the best interest of the city.

“One year will give him a chance to build business,” he said. “Given a year, if the business is going to be up and running, it should be by then.”

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